Thursday, July 8, 2010

Nursing home operators in NSW have been accused of sloppy accounting practices and failing to account for bonds in their reporting of revenue, the NSW Industrial Relations Commission has heard.

Accounting expert from the University of New South Wales, Professor Robert Walker, who conducted an audit of various nursing home operators in NSW, told the commission he found their accounting methods 'so muddied in accounting purposes as to be meaningless'.

Professor Walker told ABC radio some nursing home operators in NSW were preparing financial statements that did not comply with Australian accounting standards, and were not declaring accommodation bonds as income, despite a legal obligation to do so.

The group of aged care operators have been compelled to share their financial accounts with the commission as a result of a NSW Nurses Association (NSWNA, ANF NSW) pay claim for members working in residential aged care.

Aged care nurses are seeking wage parity with public hospital nurses in NSW, but negotiations with aged care employers floundered when operators told the NSWNA they couldn't afford a pay a rise.

The detailed financial accounts of nursing home operators were subsequently obtained by the NSWNA under subpoena.

These accounts provided a rare glimpse into the budgets of residential aged care facilities which are heavily subsidised by the federal government.

The company director of one nursing home admitted to the commission that the nursing home had been using money from the staff training account to pay for his son's veterinary science university fees since 2001, an expense which outweighed the money spent on legitimate staff training costs.

NSWNA General Secretary Brett Holmes said Professor Walker's evidence highlighted that aged care operators were demanding and receiving large sums of taxpayers' money through federal government funding, but were not required to demonstrate any accountability in how they spent it.

'There needs to be greater accountability in the sector--Professor Walker's evidence was important in shedding light on these issues for the first time.

'Aged care operators should be required to demonstrate the proportion of income they spend on resident care and nurse wages,' Mr Holmes said.

The final hearings in the case conclude early September, and the NSWNA hopes to have a decision by the end of 2004.